Orange County FHA, VA & First Time Buyer Loan Information: April 2010

My goal is to provide valuable information for home buyers, both First Time Buyers and Move Up Buyers. This information will be about loan programs such as FHA ,VA, Conventional Fannie Mae and Freddie Mac, Reverse Mortgages, and even Portfolio Jumbo programs. I will also touch on tax advantages of homeownership, Rent vs. Own analysis, and any other aspect of loans and home ownership that will be of interest to Orange County home buyers and homeowners.

FHA financing on condo's is not as difficult as some believe, as long as the project is on the FHA approved list. But what many Orange County homebuyers and their agents don't realize is not all attached homes are considered a condo.

When looking at an attached home, most people will automatically assume that if the project is not on the FHA approved list for condo's, then an FHA loan will not be possible. At least not until the project gets approved. However, if the property is not legally considered a condo, then FHA will allow financing without the project being approved.

FHA Financing on Planned Unit Development's

A Planned Unit Development, or PUD, encompasses not only Single Family Residences, but also single family attached homes, commonly referred to as townhomes or rowhomes. With a little research, it can be determined whether or not a property was built is listed as a condo or Single Family Residence.

There are also detached homes within Condo projects. Even if the project is not FHA approved, FHA financing can be done on a detached home within the project. A detached condo is typically referred to as a Site Condo. Although project approval is not required, a Condo Rider is still required for the loan. Below is a quick excerpt from a recent FHA Mortgagee Letter regarding Site Condo's.

"Site Condominiums are single family detached dwellings encumbered by a declaration of condominium covenants or condominium form of ownership. Condominium Project approval is not required for Site Condominiums; however, the Condominium Rider (Attachment D) must be included in the FHA case binder submitted for insurance endorsement."

Orange County has quite a few attached home projects which are not "condo's" There are also quite a few detached condo's that will qualify for FHA financing even if the project is not approved. It is important to understand the in's and out's of property eligibility for FHA financing before making an offer on a home. If a property is a condo, then check the FHA website to see if the project is approved. If the property doesn't show up on the list, check to make sure it is a condo at all.